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Rarely has the inception of an environmental disaster been so triumphantly documented.

In a recently unearthed black-and-white newsreel, which played before movies in theaters across Argentina in 1946, a newscaster reported that 20 beavers have been trapped in Canada and flown to Tierra del Fuego—the island that straddles the border between Argentina and Chile at the southernmost tip of South America. Argentine Pres. Juan Perón’s administration had imported the animals in hopes that they would thrive and reproduce, fostering a fur trade in the economically lackluster territory. "The beavers, who eat branches of trees and bark, will find abundance here," the newscaster stated, as the camera pans across kilometers of virgin Fuegian forests. The beavers, released from their cages, slip into a river as the voice added gravitas to the dam-building beasties’ entry into their new environs, "Now they are in God's hands."

Abundance they found. Six decades later the descendants of those 20 pioneers number in the tens of thousands in Patagonia. The beasts have swum from Tierra del Fuego to the continent and beyond, and now occupy an unknown number of islands in the vast uninhabited archipelago off the coast of southern Chile. As they waddle their way north, building dams, creating ponds and procreating, they lay waste to vast tracts of land, which appear scorched or bulldozed. The destructive power of the beavers in Patagonia surprised ecologists in North America, where the same animals have been reintroduced to wetlands in need of restoration.

But the Patagonian forests have proved particularly vulnerable to beavers. Unlike North American trees such as aspen, birch and willow, none of the region’s endemic tree species grows back once gnawed or flooded. Fifty percent of Tierra del Fuego's riparian forests are now damaged by beavers, says Christopher Anderson, a research scientist for Argentina's Austral Center for Scientific Research (CADIC). What's more, the beaver ponds cause rivers to retain 75 percent more organic matter than they otherwise would, altering the watershed's carbon cycle. Once the masticating critters move on, they leave deadwood, bogs and meadows filled with invasive flora. Beavers, Anderson says, are responsible for the biggest transformation of southern Patagonian forests since the last ice age. They have reengineered the ecosystem even more than humans have.

The beavers have also moved into the wide-open pampa, building dams of dirt and grass in drainage ditches. Ranchers trade horror stories of finding sheep stuck in the mud of a beaver pond, their eyes pecked out by birds, or of dozens of trees, planted years ago as a windbreak, felled in a single night by a family of the incisor-wielding vermin.

How do you solve a problem that consists of 100,000 beavers? For several decades, efforts were sporadic and crude, sometimes employing TNT to blow up dams. In the 1990s Chile and Argentina began exploring the possibility of controlling the beaver population by creating a commercial demand for their pelts. That was the original plan in the 1940s but it never caught on—the economic benefits were too meager to induce Fuegians to take up trapping culture. In the 1990s and 2000s both nations trained hundreds of locals to trap, encouraged restaurants to serve beaver-meat recipes and put a bounty on each beaver. In Chile 11,700 beavers were trapped in 2005 and 2006 for bounty, with thousands more snagged in Argentina.

But the bounty made no long-term dent in the population. When the state stopped paying for each tail, most trappers gave up the practice. Now it is rare to find the web-footed rodent on a menu. Worse, the program caused more ecological damage than it saved. Beavers are territorial, explains Alejandro Valenzuela, conservation coordinator for Argentina’s Southern Patagonia National Parks. If you remove a beaver colony from a pond, new beavers will move in, but they won’t use the old dam. Instead, they will build a new dam, felling more trees and creating a larger pond in the process. The better strategy is to leave a small colony of beavers, which will continue to use the original dam and defend the territory from new colonies, Valenzuela says.

Wildlife managers now have their sights set on eradication. In 2006 Chile and Argentina created a binational committee—a rare point of cooperation between these often acerbic neighbors—and commissioned a feasibility study, which determined that eradication would cost $35 million. Both governments have received Global Environment Facilities grants for pilot projects. In March, after years of political delays, Argentina will begin a pilot project to clear one watershed of beavers, which managers hope will yield information on how to scale the project up. "We want to solve all the problems—technical, administrative, financial, governance—and then expand," says Barbara Saavedra, director of the Wildlife Conservation Society’s Chile Program, which will implement one of the pilot programs.

If eradication works, Argentina and Chile will have to figure out how to restore the forests that have already been damaged. Researchers are investigating whether carbon-offset dollars could be used to fund reforestation. Initial results are not exactly hopeful: Early in reforestation trials, only half the seedlings have survived, and those have hardly grown, says Jon Henn, a visiting researcher at CADIC who received a U.S. Fulbright grant and a National Geographic Young Explorer Fellowship to conduct the trials.

Getting locals to support the program—or at least not oppose it—is essential to its success. The trouble is, “They are cute,” Valenzuela says. "It's hard for invasive species ecologists to explain to people that beautiful animals can be a huge problem. Cute or not, they are causing major problems for other species, and the only long-term fix is eradication, he notes. "These animals are not at fault." "The beaver is not the bad guy. Humans are the bad guy. We are trying to fix our mistakes," he adds.